The pension auto-enrolment scheme – Key Steps

If you are an employer who isn't exempt from automatic enrolment or you would like to make voluntary contributions on behalf of your employees, the process of setting up automatic enrolment will need to be carried out in various stages as follows:

Step 1 - Staging Date

Each employer has a 'Staging Date'. That's the date the new duties come into force for your business. You can find out your staging date by clicking on the link find out your staging date and entering your PAYE reference. You will also start receiving correspondence from The Pensions Regulator as your staging date approaches.

Step 2 - Nominating a contact

You will need to nominate a contact to ensure that they are kept up to date with the necessary guidelines as your staging date approaches. We can nominate us as your point of contact by completing the nominate a contact form.

Step 3 - Choosing a pension provider

When choosing a pension scheme for automatic enrolment you must ensure that it meets certain criteria. You should also choose a good quality scheme which provides value for money and protects your employees' retirement savings. There are many providers offering pension schemes suitable for auto enrolment. We would recommend that you begin the process of selecting a pension provider well in advance of your staging date.

Step 4 – Deciding on who you need to enroll

Some employees must be automatically enrolled into your chosen pension scheme at the staging date, whilst others may have the right to opt in. Your duty with regard to each employee is determined by their age and level of earnings, and you will need to perform an assessment in order to place each employee into a particular category. Please refer to the table below to carry out your assessment:

Monthly Gross Earnings


Weekly Gross Earnings

From 16 to 21

From 22 to SPA*

From SPA to 74

£481 & below

Has a right to join a pension scheme

£111 & below

Over £481 up to £833

Has a right to opt in

Over £111 up to £192

Over £833

Has a right to opt in

Auto Enrol

Has a right to opt in

Over £192

Step 5 - Calculating and deducting pension contributions

The amount you must contribute to the pension scheme is determined by your particular scheme's rules. If you're using the scheme for automatic enrolment there are minimum contributions which the government has set up and which must be paid into the scheme. Minimum contributions are currently 2% with employer contribution making up at least 1% of this total – please refer to the table below.



The Government adds tax relief of:

Total contribution

1.0% of your employees qualifying earnings until 6 April 2018 rising to 2.0% until 6 April 2019 then rising to 3.0%

0.8% of their qualifying earnings until 6 April 2018 rising to 2.4% until 6 April 2019 then rising to 4.0%

0.2% of your employees qualifying earnings until 6 April 2018 rising to 0.6% until 6 April 2019 then rising to 1.0%

2.0% of your employees earnings until 6 April 2018 rising to 5.0% until 6 April 2019 then rising to 8.0%

As an employer, you must contribute the minimum amount if your employee earn more than:

  • £486 per month
  • £112 per week
  • £448 per 4 weeks

You don't have to contribute anything if they earn less than this.

The minimum total contribution to the scheme is usually based on your employees' qualifying earnings.Some pension schemes also calculate pension deductions based on pensionable pay.

Please note that the standard annual allowance for pension contributions for the 2016/17 tax year is £40,000. This includes employee contributions, employer contributions and tax relief from the government.

Step 6  - Communicating with employees

By law, you must write to each member of staff to tell them how automatic enrolment will affect them and to inform them of their rights. Following your staging date, employees who are automatically enrolled into your pension scheme need to be given information about their contributions and their right to opt out of the scheme. Non-eligible jobholders must be informed of their rights to opt in the scheme and so on.

Step 7 – Completion of the automatic enrolment Declaration Of Compliance ('Registration') with The Pensions Regulator

You must provide certain information to The Pensions Regulator about how you've complied with your automatic enrolment duties, such as how many people you've automatically enrolled and into which pension scheme(s). You must complete your declaration of compliance even if you don't have anyone to automatically enroll. Declaration is mandatory and you could get fined if you don't do it in time. Your declaration deadline is five calendar months after your staging date. Declaration provides a snapshot of your workforce on your staging date and you'll need to account for each person. Please click to go to do so.